Whether an annual activity or less frequent, developing a Business Strategy is a project and needs to be managed as such with a clear beginning, middle and end: the participants may be senior and the consequences of failure significant but nonetheless, it’s still a team-based project.
Our approach is based upon the well-established 7-step Drexler/Sibbet Team Performance™ Model with a few tweaks to accommodate the specifics of strategy formulation. Business Strategy is about the future so there are a lot of unknowns that create doubt & uncertainty and these inevitably create stress within the team; this is exacerbated by the short time frame, high-stakes and possibly entrenched positions or of the participants. Without external facilitation the risk of failure significantly increases and the quality of the outputs decrease.
So what makes for a successful Business Strategy project? Based on our experience there are 5 key factors that differentiate the mediocre from the best:
1. Foresight – without a common understanding of where customers, markets & technologies are heading it is all too easy to simply end-up with an extension of existing strategy, one that misses both new opportunities and disruptive challenges. Most strategy exercises do not spend enough time raising the vision & understanding of existing trends, nor do they ensure this is based on objective external trends (rather than self-serving internal opinions). See this post Why Strategies Fail: lack of Future Vision for more on how to ensure foresight
The future is already here. It’s just unevenly distributed. William Gibson
2. Insight – insights take creativity and are very hard to generate but central to a compelling strategy, one that differentiates from competitors, old and new. Without a focus and tools to generate and nurture original insights they will not emerge or develop, or if they do, get lost.
A point of view can be a dangerous luxury when substituted for insight and understanding. Marshall McLuhan
3. Data – without accurate data it’s really hard to make sound decisions. Access to data needs to be built into the process to inform decisions in real-time as much as is possible. This may be about the existing business, competitors or future trends & markets. Often this means engaging others in the process, those that have access to the data or can help access & interpret it. Where data is lacking, assumptions need to be made explicit.
‘Without data you’re just another person with an opinion’ W. Edwards Deming
4. Challenge – this may occur naturally within the team but even if it does it is rarely systemic. Challenge is a form of ‘stress test’ and every major assumption needs to be challenged to ensure it is valid, and under what circumstances.
Most of our assumptions have outlived their uselessness. Marshall McLuhan
5. Facilitation – besides the essentials of sound planning, stakeholder engagement and journey management, there is the matter of bias. Over 23 types of bias in 5 distinct domains can arise during strategy formulation. Without professional facilitation it is likely these will go unchecked rendering the whole exercise sub-optimal and more likely, unfit for purpose.
All of us show bias when it comes to what information we take in. We typically focus on anything that agrees with the outcome we want. Noreena Hertz
Contact us for a discussion on how we can improve your Business Strategy project.